-The above figure shows the demand curve for crude oil.Suppose the price is currently $15.A supply shock suddenly raises the price to $17.What happens with the crude oil sales revenue?
A) Crude oil sales revenue stays the same.
B) Crude oil sales revenue increases by less than $250.
C) Crude oil sales revenue declines by more than $300.
D) Crude oil sales revenue declines by less than $300.

Question

-The above figure shows the demand curve for crude oil.Suppose the price is currently $15.A supply shock suddenly raises the price to $17.What happens with the crude oil sales revenue?
A) Crude oil sales revenue stays the same. 
B) Crude oil sales revenue increases by less than $250. 
C) Crude oil sales revenue declines by more than $300. 
D) Crude oil sales revenue declines by less than $300.

Quizplus · Accepted Answer

A supply shock that raises the price of crude oil from $15 to $17 would typically reduce the quantity demanded. The reduction in quantity demanded, combined with the higher price, could lead to a situation where the total revenue from crude oil sales declines. The specific choice indicating a decline of more than $300 suggests a significant decrease in quantity demanded that outweighs the increase in revenue per unit sold, leading to a net decrease in total revenue.

-The Above Figure Shows the Demand Curve for Crude Oil